Blawgletter serves as co-lead counsel in litigation against one of the two biggest cable service providers, Behrend v. Comcast Corp. (E.D. Pa.). The lawsuit alleges that Comcast entered into swaps (trading subscribers in area A for ones in area B) and acquisition deals with competing providers. The result? Comcast and Time Warner now control half or more of all U.S. cable subscribers. And they each have strangle-holds on subscribers within their "clusters" in different metropolitan areas with market shares approaching 100 percent.
What, you ask, does our antitrust case have to do with you just now? At least two things.
In the first place, the swapping of subscribers and exits of competing cable providers have resulted in much higher prices, exclusive deals between the cable giants and programmers, and less consumer choice. The NYT editors make the point nicely today: "[T]he carriers and their packages of unwanted channels are obstacles to choice." (Take that, Joe Nocera, NYT columnist and cable company apologist!)
In the second place, the Federal Communications Commission meets today to vote on whether to approve a cable competition study, which Congress requires the agency to produce each year. The analysis concludes, for the first time, that cable systems reach at least 70 percent of U.S. households and that 70 percent or more of those households subscribe. The 70/70 finding would trigger more regulatory authority by the FCC over the cable companies but would not require the agency to exercise it at all, much less in particular ways.
Comcast and TimeWarner have staged a furious assault on the leading supporter of the 70/70 determination, FCC chair Kevin Martin. The WSJ as a result today calls the finding "in jeopardy" and "at risk". The NYT reported yesterday that Mr. Martin, a Republican, has the support of one Democrat on the Commission but "is struggling" to get the other Democrat’s vote. The Washington Post this morning sounds less gloomy.
The FCC planned to start the meeting today at 9:30 a.m. Eastern but just issued a notice postponing it until 11:00 a.m. Eastern — right about now. We’ll let you know how it goes.
Barry Barnett
